Embraer Says Eastern European Market Opening Up

Embraer says its regional jet growth in Europe is coming increasingly from Eastern countries and former Soviet bloc states.

“We are seeing some new markets emerging where the interest is becoming strong,” says Simon Newitt, VP for Europe at Embraer’s commercial aircraft division. In particular, he notes, “Eastern Europe is starting to open up” as airlines there mirror what their Western European rivals have undertaken.

Newitt also expects Air Astana’s introduction of the E190 to spur regional interest. Kazakhstan’s flag carrier bought two of the aircraft. “There is a kind of reference point being established, and we are seeing interest picking up,” Newitt declares. That region’s market appears focused mostly on E190s.

Both Russia and China remain notable dark areas for Embraer, which the company attributes to political protection of domestic products. But Newitt suggests that Embraer has not given up on those regions. “We see a strong need in the 70-seat market,” he notes. Moreover, he added, there are many 737-500s that should be replaced, which could drive interest in the E195.

Newitt notes that the average age of regional jets in Russia is about 31 years, so they also are ripe for replacement.

Even with the Superjet program, there is excess demand that is currently not being met because of the low output of the Russian aircraft, Newitt points out.

Even without Russia, Embraer projects 416 deliveries in the 60- to 120-seat range in the next 20 years in the former Soviet states—or 6% of the global market. Europe, otherwise, should see 24% of deliveries of the world total.

Embraer has sold aircraft to 21 operators in Europe and the former Soviet states; the 172 aircraft placed there have an average age of 2.8 years for those in service. Almost half the E-Jet orders booked since 2010 have been from Europe.

The customer base should expand further in the coming months. Ukraine’s Dniproavia is slated to receive the first two of 10 E190s in December.